Correlation Between Dupont De and Giantec Semiconductor

Can any of the company-specific risk be diversified away by investing in both Dupont De and Giantec Semiconductor at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Dupont De and Giantec Semiconductor into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Dupont De Nemours and Giantec Semiconductor Corp, you can compare the effects of market volatilities on Dupont De and Giantec Semiconductor and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Dupont De with a short position of Giantec Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dupont De and Giantec Semiconductor.

Diversification Opportunities for Dupont De and Giantec Semiconductor

-0.26

Correlation Coefficient

Dupont De  Giantec Semiconductor

Very good diversification

The 3 months correlation between Dupont and Giantec is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Dupont De Nemours and Giantec Semiconductor Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Giantec Semiconductor and Dupont De is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Dupont De Nemours are associated (or correlated) with Giantec Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Giantec Semiconductor has no effect on the direction of Dupont De i.e., Dupont De and Giantec Semiconductor go up and down completely randomly.

Pair Corralation between Dupont De and Giantec Semiconductor

Allowing for the 90-day total investment horizon Dupont De Nemours is expected to under-perform the Giantec Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, Dupont De Nemours is 2.96 times less risky than Giantec Semiconductor. The stock trades about -0.11 of its potential returns per unit of risk. The Giantec Semiconductor Corp is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  6,356  in Giantec Semiconductor Corp on October 22, 2024 and sell it today you would earn a total of  369.00  from holding Giantec Semiconductor Corp or generate 5.81% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	96.88%
Values	Daily Returns

Dupont De Nemours  vs.  Giantec Semiconductor Corp

Dupont De Nemours

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dupont De Nemours has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest fragile performance, the Stock's fundamental indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Giantec Semiconductor

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Giantec Semiconductor Corp are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Giantec Semiconductor may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Dupont De and Giantec Semiconductor

The main advantage of trading using opposite Dupont De and Giantec Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dupont De position performs unexpectedly, Giantec Semiconductor can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Giantec Semiconductor will offset losses from the drop in Giantec Semiconductor's long position.

The idea behind Dupont De Nemours and Giantec Semiconductor Corp pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.